A Finance Blog

Net Worth Update – October 2018

So long October. This past October is actually my first acknowledged “bad” month since I started this blog. So what happened? Well for one the markets did not cooperate, which largely contributed to a decline in net worth:

Liquid Assets

Start

End

$ Change

Cash & Checking

$2,700

$1,546

($1,154)

Emergency Fund

$5,405

$5,411

+$6

Savings Goals

$725

$1,109

+$384

Brokerage Accts

$1,355

$1,297

($58)

Illiquid Assets

Start

End

$ Change

Savings Bonds

$1,405

$1,407

+$2

Home Equity

$18,125

$18,688

+$563

401K

$39,880

$38,580

($1,300)

Roth IRA

$25,400

$23,789

($1,611)

Liabilities

Start

End

$ Change

Loans

($13,190)

($12,235)

+$955

Net Worth

$81,805

$79,593

($2,213)

% Change

-2.7%

Another thing that didn’t help my budget was having to buy a new chromebook for the second month in a row.

Category

Budgeted

Actual

Remaining

(1) Bills & Utilities

$755

$745

$10 under

(2) Food

$300

$210

$90 under

(3) Medical

$-

$79

$-

(4) Everything Else

$300

$1,008

$708 over

Total (1+2+4)

$1,355

$1,963

$608 over

I have bad computer luck, so I really should have insured my old chromebook, but I didn’t. And since it was cheap, it didn’t survive the fall off my coffee table. The new Chromebook cost me $600. It is insured for 4 years, and this one has “gorilla glass”. So at least I won’t have to worry about saving for a new one next year. If it weren’t for this purchase I wouldn’t have gone so far ($608) over budget. Good thing I earned an extra $800 last month.

I also paid 3 periodic bills that totaled another $600. I did anticipate them, which is why my “Bills & Utilities” budget is so much higher than usual.

And I’m pretty proud of my low medical costs this month. I am still waiting on a few bills, and I anticipate higher costs in November/December.

A New Budgeting Method

One new thing that I tried in October was to not actively track my budget. I only tallied up my expenses at the end of the month for the consistency of this blog. I think I’m going to try it again next month to see how it goes. I know that I budget $600 for my “Food” and “Everything Else” expenses. Since all these expenses go on my credit cards, I can easily keep track of my progress by ensuring my credit cards do not exceed a collective total of $600. Budgeted expenses that fall outside of “Food” and “Everything Else” categories (such as “Bills & Utilities”), can be paid right away to make tracking easier. If it works out well, I will no longer meticulously track my expenditures.

Next Month

I’m really looking forward to next month. I’ll be getting three paychecks! This year is a bit unusual since there will be three months with three paychecks instead of the usual two (i.e. 27 pay periods instead of 26). I plan to purchase a TV, put money aside for Christmas presents, and make a loan payment to my parents. It’s been pretty hard for me to save, since I’m paying down my 401K loan. I plan to stop aggressive payments in January 2019. In June 2019, I should have my furniture loan paid off and get a pay raise. Then I’ll be in a position to save up to $300/month. If I were more strict with my current budget I could do that now.

Next Year

This month it’s open season and I’ll have to decide on my healthcare plan for 2019. I had been internally debating over whether I should switch to a High Deductible Healthcare Plan (HDHP) so I could make use of an HSA. My employer recently published the options for next year. Interestingly, the HDHP is strictly better. According to my calculations, if I have a year of perfect health, the HDHP would result in $4,000 in savings over the regular option. If I have a year of poor health the HDHP would still result in sizable savings of $1,600 over the alternative. Usually, HDHPs are more expensive than low-deductible alternatives if you use a lot of medical care resources . In this case, the HDHP monthly premium payments are near $0, which offsets the higher deductible and out of pocket maximum.

Recap

All in all the month wasn’t terrible, I didn’t lose any sleep over my financial circumstances or anything, but I’ve had better months.